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Thursday, February 25, 2016

Canada to Remain as part of JSF F-35 Consortium

Undated/Uncaptioned photo of F-35 from The Associated Press

Published by: Steven Chase, The Globe and Mail

The Canadian government intends to make a payment this spring to remain part of the consortium of F-35 Lightning fighter-jet buyers, despite a Liberal election promise to exclude the aircraft when selecting this country’s next warplane.

The move raises questions about whether the Liberal government is reconsidering its ban on purchasing the controversial F-35 jet.

Prime Minister Justin Trudeau’s party announced during last year’s election campaign that it “no longer makes sense” to buy a fighter with the F-35’s stealth, first-strike capability, citing skyrocketing costs for a plane that has been plagued with development problems. The Liberals vowed instead to buy a “lower-priced” aircraft and funnel the money saved into the Royal Canadian Navy.

This week, however, Department of National Defence spokeswoman Ashley Lemire said Canada plans to pay the latest required annual instalment to the Joint Strike Fighter program. She said the upcoming payment is estimated to be $32.9-million (U.S.)

The contribution would maintain Canada’s membership in the F-35 buyers’ pool. This gives Ottawa the right to buy F-35s at a discount and allows Canadian companies to continue to bid on supply contracts for the plane.

Asked why Canada remains in the Joint Strike Fighter program when the Liberals have eliminated the plane as an option, Defence Minister Harjit Singh Sajjan said the government is still reviewing how it should proceed on replacing the country’s aging CF-18 fighters.

“We can’t just make a very quick decision on something like this. We want to make a responsible decision as we move forward. We have to go through the proper requirements. Once we go through a proper process, decisions will be made at that,” he said.

The annual required contribution to remain in the Joint Strike Fighter program, alongside allies such as the United States and Britain, has varied between $21-million and $48.5-million over the past five years.

Conservative Senator Daniel Lang said the federal government’s decision to stay in the program is puzzling.

“Why would anybody spend millions of dollars to stay in a program they’re not going to participate in?” said Mr. Lang, who chairs the Senate national security and defence committee.

Leaving the Joint Strike Fighter program would hurt Canadian business because companies would no longer be able to bid on contracts to supply parts and software for the plane.

Canadian companies have won more than $750-million in contracts related to the F-35 because Canada has been a partner in the program for decades. Should the Liberals exit the program, Canadian firms’ contracts will wind down and they will not be eligible to bid on further work.

“At this time, Canada remains in the Joint Strike Fighter program, which ensures Canada can continue to benefit from economic opportunities resulting from the partnership while we work to determine the way forward,” the Defence Department’s Ms. Lemire said.

One procurement expert working for the federal government, who spoke on condition of anonymity, said it’s unclear whether Ottawa could successfully defend against legal action should it bar jet maker Lockheed Martin and its F-35 plane from a competition. “They will have to decide whether they want to run a competition or face a lawsuit.… The easiest option for a variety of reasons is to run a competition and run it fairly.”

The Liberals inherit a military purchasing effort plagued by delays and cost overruns, from shipbuilding to aircraft.

“I will be honest with you. Our procurement system is not providing capabilities to [Canadian Forces] members in a timely manner,” Mr. Sajjan told the Senate on Wednesday.

The Trudeau government has created a cabinet committee to oversee defence procurement that will be headed by Natural Resources Minister Jim Carr, who previously served as president and chief executive of the Business Council of Manitoba.